FEES IN COMMERCIAL VS. RESIDENTIAL PROPERTY OWNERSHIP

Whether you like the higher yields available to commercial real estate investors, or residential is more your thing, it’s important to have a firm grip on any fees you are paying your agent.

In this article, we’ll look into leasing and management fees for both commercial and residential property investors.

Commercial Property Leasing Fees

When it comes to leasing commercial property, agents are very transparent. You will usually only pay one single leasing fee plus any marketing that you agreed with your agent.

The leasing fee itself is almost always calculated as a percentage of the annual rent. On average, you will find leasing fees from 8% (just less than 1 month) all the way to 15% of the average annual rent.

Residential Leasing Fees

Ok, so Nutshell specialises in commercial property, not residential. But we still have a fairly good idea of what our residential counterparts charge.

Leasing fees on residential properties are significantly cheaper than on commercial. This reflects the fact that it is significantly easier to lease residential property. A typical fee is 1-2 weeks rent.



Commercial Property Management Fees

Management fees for commercial properties are also generally transparent and are almost always calculated based on a percentage of the monthly rent. This mean that while your property is vacant, or your tenant neglects to pay their rent, your property manager also goes hungry.

Typical management fees for commercial property range from 3-6% depending on the size, location, and the amount of work involved.

Other fees you may be charged by your property manager could include:

  • An administration fee.
  • Arranging Repairs or Maintenance
  • Negotiating Rent Variation
  • Applying for a Court/Tribunal process
  • Service of Notice or Summons
  • Appearing at Court/Tribunal
  • Arranging valuations for Insurance claims
  • Attending on Insurance claims
  • Collecting/Recovering outgoings from Lessee
  • Other attendances including emergency inspections
  • Residential Leasing Fees

Most won’t charge these fees but watch out for it anyway.

Residential Property Management Fees

Similarly to a commercial property manager, a residential property manager will charge a management fee based on the weekly or monthly rent. Fees can vary from 4%-10% depending mainly on the location.

Other fees you may be charged could include:

  • Lease renewal fees
  • Tenancy agreement fees
  • Administration fees
  • Preparation for tribunal
  • Overseeing maintenance (usually calculated at around 5% of the cost of repairs)

Agents can add sneaky fees in the small print, or waive these additional fees altogether, so it’s important to check your agency agreement!

Property Management Marrickville

Here at Nutshell, we are proud to provide property management and leasing services to owners of commercial real estate in Sydney. We are based in Marrickville and serve all of Great Sydney.

If you are a commercial property investor and want to know what we charge, get in touch with us today.

If you’d like to see a full rundown of our property management fees, access our Schedule of Fees below:



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